Self Made Men Who Started from Nothing

I was recently drawn into an online discussion, attempting to help an inexperienced but entrepreneurial poster understand fundraising options such as debt and equity.

It took a turn for the worse when he asked how to raise $100,000,000 without selling equity, and when I revealed a bank was unlikely to lend that sort of money based on ‘an idea’ he produced a list of self-made men who started with nothing.

How, he demanded to know, did they shift from rock bottom to fortunes. So I did the research – as you can see, even self-made men who started with nothing started with something.

Andrew Carnegie – borrowed $500 from his mother, who borrowed it using her $700 house as collateral

John D Rockefeller – saved diligently and took on a business partner (ie, diluted equity) with both putting $2,000 of their own savings into the new venture

Richard Branson – borrowed money from his mother to keep his first business The Student magazine afloat, which led to mail-order records (likely on consignment, so positive cashflow until he opened the Virgin Record store)

The Koch brothers, derived their wealth through their father Fred who combined an engineering business partnership (there’s that equity sharing again) and a patent that had to survive years of litigation

Ingvar Kamprad – Starting selling matches as a boy, but IKEA was founded with a cash gift from his father

Carlos Slim – was a stock broker with a good financial education, starting his first business only after his personal investments had reached $400,000

Frank Mars – worked in Sales from the age of 19, establishing Mars 10 years later (1910/11) selling candy wholesales from his kitchen until finally funding a factory almost another 10 years later (1920)

These individuals spanned a century of entrepreneurship, and I think everyone would agree that they took responsibility for their own destinies and created their business empires from humble beginnings.

None of them took an idea to a bank and was blessed with an enormous bankroll to trial their idea. These self-made men either built their business:

having first worked hard for many years to build their own savings and investments, or

via a partnership, sharing equity, having a co-founder to support their risk and reward ratio, or

with the help of a loan or gift from a parent (which isn’t really rock bottom)

Take responsibility, like these individuals did, and you can create great things in business. Don’t hide behind the fact nobody wants to give you $100,000,000 as an excuse for why you’re not successful.

2 Responses to “Self Made Men Who Started from Nothing”

One small correction to one of Mr. Aldridge’s examples. Andrew Carnegie’s mother was desperately poor until Andrew started making enough money to support her. He bought her the first house she ever owned, and every house she ever owned.

There is an apocryphal story about her taking a mortgage on the house he’d bought her so that he could buy some shares of stock at a time when he didn’t have ready cash, but some versions of the story say that he actually borrowed the money from Thomas Scott. In any event the only help Carnegie ever got from his mother was the values and habits she taught him in childhood.